(a) There is established within the general fund a special agency account to be known as the “petroleum underground storage tank fund” referred to in this chapter as the “fund.”

(b) All fees, civil penalties, and damages collected pursuant to this chapter shall be deposited in the fund. Damages, costs, restitution awards, and other recoveries collected or received by this state related to or arising from claims under this chapter, shall also be deposited into the fund to the extent that such recoveries represent the restoration of amounts disbursed from the fund, including any costs charged to the fund in pursuing such claims. Any deposits to the fund that would result in the unobligated balance of the fund exceeding fifty million dollars ($50,000,000) shall be transferred to the highway fund.

(c) No part of the fund shall revert to the general fund, but shall be carried forward until expended in accordance with this chapter.

(d) Interest accruing on investments and deposits of the fund shall be returned to the fund and remain a part of the fund.

(e) The board shall, when adjusting underground storage tank fees by rule as provided in § 68-215-109, consider all reasonably anticipated current and future liabilities and income of the petroleum underground storage tank fund, and, adjust underground storage tank fees, using an equitable and fiscally sound approach to sustain the long-term viability of the fund, to levels that are intended to result in sufficient funding of the current obligations, and actuarially determined obligations, after taking into account projected revenues that are reasonably expected to be available to fund these obligations as they become due, up to an unobligated maximum balance of fifty million dollars ($50,000,000) in the fund. The board shall not consider lowering or suspending the fees to a level that will result in a failure to maintain a balance above an amount sufficient to cover the then projected annual amount of claims against the fund, as well as, anticipated administrative expenses for the year. After consideration of all relevant information, including information requested by the board from the department and any additional information provided by the department, the board shall choose the process, timing and assumptions to be used in the board's determinations of the obligations, anticipated income, and appropriate fund balance.

(f) For each fiscal year there is appropriated a sum sufficient from the fund to provide for the administrative costs of the underground storage tank program.

(g) Moneys in the account shall be invested by the state treasurer for the benefit of the fund pursuant to § 9-4-603. The fund shall be administered by the commissioner.

(h)

(1) To provide for the stability of the petroleum underground storage tank fund, there is levied, in addition to all other fees or taxes, an environmental assurance fee of four tenths of one cent (0.4¢) per gallon on each gallon of petroleum products imported into this state and petroleum products manufactured in this state. For the purpose of this levy, petroleum products are those defined in § 67-3-103.

(2) The environmental assurance fee is for the purpose of assuring sufficient funding of emergency, preventive, or corrective actions necessary when public health or safety is, or potentially may be, threatened from any release of regulated substances from an underground storage tank or the use and service thereof.

(3)

(A) Such environmental assurance fee shall be paid and remitted to the department of revenue on a monthly basis at the same time and in the same manner that the special tax on petroleum products is paid and remitted pursuant to § 67-3-203. Such tax collections are appropriated, and are to be allocated and expended on an annual basis only in the following order of priority:

(i) First to the Tennessee local development authority, referred to in this section as the “authority,” a sum sufficient to make debt service payments on the authority's bonds or notes, both currently outstanding and those reasonably anticipated to be issued during the fiscal year, issued pursuant to the Tennessee Local Development Authority Leaking Underground Storage Funding Act of 1997, compiled in title 4, chapter 31, part 9, the proceeds of which have been or will be distributed to the board pursuant to a funding agreement, plus any amounts necessary to maintain a fully funded debt reserve or other reserve intended to secure the principal and interest on the bonds or notes as may be required by resolution, or other agreement of the authority, and to pay reasonable administrative costs directly related thereto; and

(ii) Second, for a period of three (3) years starting July 1, 2009, the state shall credit an amount not to exceed three million dollars ($3,000,000) to the general fund annually, if the annual general appropriations act so provides, and the remainder shall be credited to the petroleum underground storage tank fund. On July 1, 2012, and thereafter, all of the funds received from this fee shall be credited to the petroleum underground storage tank fund.

(B) Prior to the start of each fiscal year, and to the extent necessary during the fiscal year, the following certifications shall be made and delivered to the authority:

(i) The commissioner of finance and administration, the actual expenditures of the fund;

(ii) The commissioner of revenue, the actual collections made pursuant to subdivision (h)(1);

(iii) The commissioner of environment and conservation, the amount of anticipated expenditures and claims against the fund, excluding payments in subdivision (h)(3)(A)(i), and the amount of anticipated tank fees collected pursuant to § 68-215-109; and

(iv) The authority, the amount reasonably anticipated to be necessary to make such payments as provided in subdivision (h)(3)(A)(i).